Answer:
$12,500
Explanation:
Depreciation Expense = (Book Value of machine - Residual Value)/Useful Life
= ($34,000 - $2,000)/8
= $4,000 per year
Depreciation Expense for years 2017 & 2018 would be $4,000 X 2 = $8,000
Net book Value on January 1, 2019 = $34,000 - $8,000 = $26,000
New Residual Value = $1,000
New Useful Life = 8 - 2 - 4 = 2 Years
Depreciation expense for 2019 = ($26,000 - $1,000)/2 = $12,500
Answer:
$2,500
Explanation:
Bad debt Expense will be calculated using the percentage of debt loss. The expense will be calculated using the account receivable balance.
Estimated allowance for doubtful accounts = Credit Sales x percentage = $300,000 x 1% = $3,000
Current Balance = $500 credit
As Allowance for Doubtful Accounts already have credit balance of $500, we need to adjust the remainder to make the closing balance of Allowance for Doubtful Accounts $3,000 at the year end.
Adjustment Value = $3,000 - $500 = $2,500
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